Internal Audit and Compliance - Health Care Compliance Association

n Providing training to staff that is in addition
to the current training schedule;
n Engaging an independent review organization
(IRO) to review the areas that the
OIG has determined to be problematic.
By Julie Katich and Karolyn Woo
Editor’s note: Julie Katich and Karolyn and determine to what degree each of the
Woo are with Deloitte & Touche, LLP. seven elements will be implemented; therefore,
Julie can be reached by e-mail at
compliance programs and their effectiveness are
jkatich@deloitte.com and Karolyn can be as varying in nature as the organizations themselves.
In some situations, it takes a government
reached by e-mail at kwoo@deloitte.com.
intervention, such as the issuance of a Corporate
In an effort to protect against potential Integrity Agreement (CIA), to enhance the
instances of fraud and abuse, many health organization’s compliance program.
care organizations have adopted voluntary
compliance programs. Using the various It is no surprise that when an organization
Office of Inspector General’s (OIG) guidances
for health care and life sciences orgative
view of the agreement from a cost and
enters a CIA, it will often have a neganizations
and the U.S. Federal Sentencing resource perspective. If the organization
Guidelines, organizational compliance programs
typically include the following seven the program may not be as effective and
already has a compliance program in place,
elements:
robust as the OIG expects when compared
1. Governance and Oversight
to industry standards and government guidance.
Additionally, the program likely does
2. Policies and Procedures
3. Reporting System
not fulfill all of the requirements contained
4. Training and Education
within the CIA. Typically, the organization
5. Enforcement
must implement new practices and modify
6. Response and Prevention
existing ones to meet the numerous mandates
of a CIA. This is often an onerous
7. Auditing and Monitoring
process. Common CIA requirements include
Because health care organizations are so diverse, enhancements to the compliance program,
no optimal or standard compliance program such as:
best suits all organizations. Rather, organizations
are free to adopt programs that reflect guide the compliance officer and compli-
n Activating a compliance committee to
their commitment to compliance and take into ance program and set the tone at the top
account government guidance and industry of the organization and demonstrate board
practices. An organization’s compliance program and senior management commitment to
should promote integrity and minimize the the program;
risk of fraudulent activities. It is up to each n Revamping the training and education
organization to assess its unique characteristics content to address the alleged misconduct;
Unexpected benefits of a CIA and an IRO
When an organization implements its CIA,
it is not unusual for the organization to
either re-allocate existing resources or acquire
new personnel to support the compliance
program. The organization is often forced
to adopt a more comprehensive program
(sometimes in several of the seven elements
and sometimes only a few) that is maintained
by dedicated resources and supported from
the top level down.
Sometimes, these changes result in unexpected
benefits for the organization. That is,
an organization that is subject to a CIA often
finds itself with a more robust and effective
compliance program than prior to the CIA.
An additional benefit is that when the CIA
requires an IRO, the IRO provides valuable
insight into industry leading practices and
makes suggestions for operational enhancements
for the organization. As an organization
makes changes in accordance with the
CIA requirements, it also will benefit from
suggested changes or modifications that are
made or recommended by the IRO.
From an operational perspective, an effective
compliance program will, in turn, improve
organizational communication, teamwork,
and overall operational efficiency. Similarly,
the mandatory reporting requirements of
the compliance activities often serve to
improve the internal controls environment
and reduce the likelihood of fraud, especially
given the increased focus on the compliance
environment as related to the Sarbanes-Oxley
legislation.
Continued on page 32
November 2006
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